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Arhaus, Inc. (ARHS) Hit a 52 Week High, Can the Run Continue?
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Have you been paying attention to shares of Arhaus, Inc. (ARHS - Free Report) ? Shares have been on the move with the stock up 18.3% over the past month. The stock hit a new 52-week high of $15.27 in the previous session. Arhaus, Inc. has gained 49.5% since the start of the year compared to the 9.7% move for the Zacks Retail-Wholesale sector and the 10.7% return for the Zacks Retail - Miscellaneous industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on November 10, 2022, Arhaus, Inc. reported EPS of $0.27 versus consensus estimate of $0.15.
For the current fiscal year, Arhaus, Inc. is expected to post earnings of $0.88 per share on $1.23 billion in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $1.09 per share on $1.4 billion in revenues. This represents a year-over-year change of 0.96% and 14.05%, respectively.
Valuation Metrics
Arhaus, Inc. may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Arhaus, Inc. has a Value Score of B. The stock's Growth and Momentum Scores are A and F, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 16.6X current fiscal year EPS estimates, which is a premium to the peer industry average of 16.6X. On a trailing cash flow basis, the stock currently trades at 19.4X versus its peer group's average of 6.7X. Additionally, the stock has a PEG ratio of 1.04. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Arhaus, Inc. currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Arhaus, Inc. meets the list of requirements. Thus, it seems as though Arhaus, Inc. shares could still be poised for more gains ahead.
How Does ARHS Stack Up to the Competition?
Shares of ARHS have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Ulta Beauty Inc. (ULTA - Free Report) . ULTA has a Zacks Rank of # 2 (Buy) and a Value Score of C, a Growth Score of C, and a Momentum Score of B.
Earnings were strong last quarter. Ulta Beauty Inc. beat our consensus estimate by 30.56%, and for the current fiscal year, ULTA is expected to post earnings of $24.26 per share on revenue of $9.99 billion.
Shares of Ulta Beauty Inc. have gained 8.9% over the past month, and currently trade at a forward P/E of 21.91X and a P/CF of 22.94X.
The Retail - Miscellaneous industry is in the top 40% of all the industries we have in our universe, so it looks like there are some nice tailwinds for ARHS and ULTA, even beyond their own solid fundamental situation.
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Arhaus, Inc. (ARHS) Hit a 52 Week High, Can the Run Continue?
Have you been paying attention to shares of Arhaus, Inc. (ARHS - Free Report) ? Shares have been on the move with the stock up 18.3% over the past month. The stock hit a new 52-week high of $15.27 in the previous session. Arhaus, Inc. has gained 49.5% since the start of the year compared to the 9.7% move for the Zacks Retail-Wholesale sector and the 10.7% return for the Zacks Retail - Miscellaneous industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on November 10, 2022, Arhaus, Inc. reported EPS of $0.27 versus consensus estimate of $0.15.
For the current fiscal year, Arhaus, Inc. is expected to post earnings of $0.88 per share on $1.23 billion in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $1.09 per share on $1.4 billion in revenues. This represents a year-over-year change of 0.96% and 14.05%, respectively.
Valuation Metrics
Arhaus, Inc. may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Arhaus, Inc. has a Value Score of B. The stock's Growth and Momentum Scores are A and F, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 16.6X current fiscal year EPS estimates, which is a premium to the peer industry average of 16.6X. On a trailing cash flow basis, the stock currently trades at 19.4X versus its peer group's average of 6.7X. Additionally, the stock has a PEG ratio of 1.04. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Arhaus, Inc. currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Arhaus, Inc. meets the list of requirements. Thus, it seems as though Arhaus, Inc. shares could still be poised for more gains ahead.
How Does ARHS Stack Up to the Competition?
Shares of ARHS have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Ulta Beauty Inc. (ULTA - Free Report) . ULTA has a Zacks Rank of # 2 (Buy) and a Value Score of C, a Growth Score of C, and a Momentum Score of B.
Earnings were strong last quarter. Ulta Beauty Inc. beat our consensus estimate by 30.56%, and for the current fiscal year, ULTA is expected to post earnings of $24.26 per share on revenue of $9.99 billion.
Shares of Ulta Beauty Inc. have gained 8.9% over the past month, and currently trade at a forward P/E of 21.91X and a P/CF of 22.94X.
The Retail - Miscellaneous industry is in the top 40% of all the industries we have in our universe, so it looks like there are some nice tailwinds for ARHS and ULTA, even beyond their own solid fundamental situation.